Kyivstar kerfuffle causes Telenor to segregate unit’s results

23 Mar 2007

Norwegian telecoms group Telenor has de-consolidated its 56.5%-owned Ukrainian cellular subsidiary Kyivstar from its financial reports because it no longer has ‘sufficient influence’ due to legal disputes with Storm, part of the Russian Alfa Group, which owns the other 43.5% in the cellco. Storm earlier obtained court rulings prohibiting Kyivstar’s management from providing financial information to international auditors and shareholders. Alfa reportedly called the decision a victory in its long-running feud with Telenor. The two companies are also at odds as the major shareholders of Russian cellco Vimpelcom. Analysts quoted by Reuters say that Alfa’s apparent tactical win in Kyivstar could push Telenor back into negotiations on a possible swap of its Vimpelcom stake for Alfa’s Kyivstar’s holding, an idea previously rejected by the Norwegian firm.